Are Credit Unions Good for Business Accounts?
Credit unions could be a great choice for small and medium businesses that value low fees, personal service and flexible financing. They also offer local partnerships and less complexity than large national banks.
Takeaways:
- Credit unions are member-owned financial institutions that offer a range of business banking services and good options for small to mid-sized businesses and entrepreneurs.
- Credit unions are federally insured, which means that deposits are protected up to $250,000.
- A credit union's goal is to improve the financial well-being of individual and business members and communities.
- Credit unions can help businesses by offering low rates on loans and competitive interest rates on business savings accounts.
- BECU business deposit accounts don't charge monthly maintenance fees.
Banks vs. Credit Unions for Business Accounts
In many ways, banks and credit unions might make equally suitable partners for a business owner hoping to open a deposit account. Both can be federally insured institutions offering up to $250,000 in coverage for deposits, and provide a variety of checking, savings and loan options.
Just like a bank, a credit union's staff includes lending officers, credit analysts, credit administrators and business development officers. It can be convenient for business owners to do personal and business banking at the same institution. Credit unions also might have specialized business expertise and can make lending decisions tailored to their membership or a specific geographic area.
In other ways, they differ: Credit union services are only offered to members. An authorized business representative (or other legal entity) must qualify and be within the credit union's field of membership. For example, to become a BECU business member,1 the business must be in specific regions or be involved with eligible associations or groups.
Credit unions are not-for-profit financial institutions that may charge fewer fees and offer competitive rates on business accounts. They can typically offer secured loans up to $3 million, which is in line with the needs of most small and mid-sized businesses, and unsecured up to $100,000. BECU also offers commercial real estate financing higher than $3 million.
Learn more about credit unions to decide if they're right for your business banking needs.
1. Credit Unions Are Not-For-Profits
Credit unions are owned by their members, while banks are either publicly held or privately owned. This credit union difference means that a member-owned credit union has a finger on the pulse of what its business members may actually want in business accounts and services.
Credit unions were built on the philosophy of putting their members first. According to a 2025 American Customer Satisfaction Index survey of credit unions, 79% of credit union members are extremely happy with transaction speeds, staff courtesy, helpfulness and call center services, among others.
As not-for-profit institutions, there aren't owners or shareholders who benefit from increased profits. So, credit unions have competitive rates for business loans and financing. Credit unions are structured to reinvest revenue into the credit union and community giving.
What's more, having a strong presence in local communities — not just bustling city centers — allows credit unions to position themselves alongside the goals of other community members and organizations.
A credit union's charter or field of membership is often based on location or has a local presence, with professional market knowledge in your area. This can put you in a position to get the best products or a loan for your specific type of business. Once you've established a relationship, you can leverage that knowledge for future business decisions.
2. Competitive Business Savings and Checking Account Rates
Because it's a not-for-profit institution, a credit union may offer competitive deposit rates and transaction fees for business checking and savings accounts.
Many credit unions offer digital and mobile banking services without a fee, making it easy for small business owners to manage business finances on the go and separate business expenses from personal ones. These services can also connect with tools like QuickBooks, which can make accounting for small businesses easier.
Business Checking Accounts
Credit unions offer a range of low-cost business checking services, including business debit cards. Look for a business checking account with:
- No or low fees such as no monthly service fee, no charge on electronic debits and credits, or no foreign transaction fees
- Free bill payment, and online, mobile and telephone banking
- Remote check deposits
- Free business ATM, debit and deposit-only ATM card(s)
Business Savings Accounts
Businesses can use savings accounts to build a cash cushion for emergencies or for a big purchase in the future. It's also a way to earn compounding interest. Business savings accounts are typically offered in three different account types:
- Business savings account: A standard, traditional business savings account you can add to or withdraw money from at any time.
- Business money market account: Typically, a business money market account will have a higher rate than a standard savings account. You'll also get check-writing privileges. At BECU, business money market accounts' interest rates are higher for higher balances.
- Business certificate of deposit: Fixed-term or standard business CDs pay more interest than a standard savings account. Still, you can't remove money whenever you wish without paying a fee (typically equivalent to a few months of interest). Some credit unions also offer add-to business CDs and bump-up business CDs.
Look for business savings accounts with:
- No minimum balance requirements
- No monthly maintenance fees
- Ability to earn interest
- Access to surcharge-free ATMs
- Low- or no-fee deposits
- No-fee cash services
- Account alerts, statements and online banking
3. Competitive Business Credit Options and Loan Types
Credit unions often offer competitive interest rates on business loans, lines of credit1 and commercial real estate loans2. They also may provide access to U.S. Small Business Administration programs and other funding for your business needs. Credit unions may lend to many businesses, including these major types of industries:
- Service
- Retail
- Manufacturing
- Wholesale or distributors
- Commercial real estate
- Non-profit organizations
- Energy production
Credit unions may consider the complete picture of a growing business, not just credit scores, and they may offer custom loan products for small and medium-sized business banking.
Business credit and loans can include:
- Equipment loans to purchase business equipment, machinery or other business needs
- Business vehicle loans
- Business line of credit for short-term financing needs
- Business credit cards3 for immediate or revolving financial needs
However, commercial lending is complex and may not be offered by every credit union. You'll also need to qualify for business membership at a credit union. Compare your loan and credit options across several different categories when considering a credit union for your business.
4. Credit Union Services for Your Small Business
Some credit unions offer business advisory support, including classes, workshops and guidance on financial planning, budgeting and managing cash flow. Credit unions may also provide merchant services4, and payroll and human resources services5 comparable to larger traditional banks.
Cash management services at a credit union can include:
- Account services: Analyzed checking, zero-balance accounts and sweep services
- Accounts receivable: Point-of-sale payment processing and high-speed online deposits for checks
- Accounts payable: Domestic online wire transfers and payroll services
Even if your credit union doesn't have a physical location in your community, or you travel often as a business owner or have multiple business locations, you might be able to bank from anywhere using online and mobile banking, or via the shared branching network at another credit union's branch.
Shared branching also allows businesses to make deposits and withdrawals using ATMs of other credit unions across the country — without surcharge fees. For example, BECU members have nationwide access to more than 77,000 surcharge-free ATMs.
5. Federal Insurance for Business Funds
Like for-profit banks, credit unions are federally insured. Instead of Federal Deposit Insurance Corporation coverage, credit unions are insured by the National Credit Union Administration through the National Credit Union Share Insurance Fund. Regulated by federal law, credit unions are held to high standards of safety and soundness.
This means that NCUA insures business checking account and savings account deposits up to $250,000 if the credit union were to fail. This is the same amount of coverage provided by the FDIC for business deposit accounts at federally insured banks.
NCUA coverage for business accounts differs from individual member account coverage. You can use the NCUA Share Insurance Estimator to calculate the insurance coverage of all accounts types offered by a federally insured credit union.
In addition, a paper from the Haas School of Business at University of California, Berkeley (PDF) looking at a recessionary period found that credit unions are more successful during a recession, with fewer risky and delinquent loans and higher returns on assets and investments.
FAQs
Why Should I Use a Credit Union Instead of a Bank?
A credit union might appeal to you for your business if you're seeking competitive rates on business checking, savings and loan accounts. It can also be a good fit if you're looking for a financial institution that reinvests money into the local community and economy.
What Do I Need to Open a Business Account?
A business will need to qualify for membership to use business accounts or a business credit card at a credit union. For example, at BECU, businesses qualify if more than half of their owners, members or employees live in a specific location or are members of a specific association.
After you ensure your business is eligible for a credit union business membership, gather the following:
- Personal identification for all authorized signer(s)
- Updated registration with the applicable agency (Secretary of State or Department of Revenue)
- Email and phone number for all authorized signer(s)
- Business tax ID, such as an EIN for LLCs, corporations and partnerships or SSN for sole proprietors
- UBI/state registry number (refer to your business license)
- NAICS code (locate your NAICS code)
The above article is intended to provide generalized financial information designed to educate a broad segment of the public; it does not give personalized financial, tax, investment, legal, or other business and professional advice. Before taking any action, you should always seek the assistance of a professional who knows your particular situation when making financial, legal, tax, investment, or any other business and professional decisions that affect you and/or your business.
1 Establishing business membership requires a Business Member Share savings account to be opened and maintained; not all applicants will qualify.
2 Business Lines of Credit subject to credit approval. Once established, if needed, funds transfers will be made to the business checking account in $100 increments (or the unused portion of the available credit limit if less than $100). Interest charges accrue from the date any credit advance or transfer is posted to your account.
3 Rates and financing offered are based on applicant's credit qualifications and other underwriting criteria. Fees may apply. Lending programs, including rates and terms, are subject to change without notice. This loan program is for business purposes and commercial loans only. Certain conditions and limitations apply. Not every applicant will qualify.
4 Merchant products and services are offered by Clover. Clover is solely responsible for the delivery and quality of those products and services. BECU does not guarantee nor expressly endorse any particular product or service.
5 Payroll services and related products are offered by Paychex®. Paychex is solely responsible for the delivery and quality of those products and services. BECU does not guarantee nor expressly endorse any particular product or service.
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Lora Shinn
Contributor